Here's to the crazy ones, the misfits, the rebels, the troublemakers, the
round pegs in the square holes... the ones who see things differently -- they're
not fond of rules... You can quote them, disagree with them, glorify or vilify
them, but the only thing you can't do is ignore them because they change
things... they push the human race forward, and while some may see them as the
crazy ones, we see genius, because the ones who are crazy enough to think that
they can change the world, are the ones who do.

Steve Jobs
US computer engineer & industrialist (1955 - 2011)

Sunday, April 28, 2013

Were the Innu bribed for the Muskrat Falls Vote?

The Innu communities of Labrador, Sheshatsui and Natuashish, are tight communities. Understanding what is taking place, or has taken place there is difficult at best. With a total population of 2245 people according to the 2011 census, everybody knows everybody and large families dominate the political and economic life in the communities. Therefore, getting accurate information of what is happening there is almost impossible for outsiders. This article is made possible by a number of Innu who have broken that code of silence and taken me into their confidence - for that I'm thankful to them as we should all be.

In the early 1980's Peter Penashue and two other people Incorporated a body politic now called the "Innu Nation". Essentially, the Innu Nation's purpose was to act as a quasi-government for the Innu people, because without a finalized land claim the two communities could only represent themselves and not the overall interests of the Innu in Labrador. The first real major financial victory for the Innu Nation came with the Voisey's Bay Agreement.

The Innu had tried to stop it until they had a land claim in place, but the courts ruled it could proceed and an impacts and benefits agreement was put in place. As part of that agreement the Innu would receive quarterly royalty payments from the provincial government of 5% of Vale's Voisey Bay sales and $59 million for the Teshipitakan Fund (T-Fund). The T-Fund was created soley as a fund for future generations (ie: the Innu children). As of February 4, 2011 the fund had grown to $66 million. Revenues from Voisey's Bay are split 3 ways: 50% to the T Fund (Innu Nation); 25% to the Sheshatsui Community Fund; and 25% to the Natuashish Community Fund.

The trustees of the fund, members from each Innu community and the Innu Nation, have been trying to gain access to the children's trust for some time. Minutes of their meetings show a determined effort by Paul Rich, brother-in-law of Peter Penashue, to take $25 million from the fund to build houses. The money was to be split evenly between the communities. He had no support but managed to have the trustees lawyers give an opinion. The only way to pull money from the trust was to prove a "man-made disaster" had occurred. He tried to have the housing issue put in that context. The issue was so divisive the trustees were read the Trust's mission statement, and they reviewed their trustee's Oath of Office. The trustees were cautioned by the manager to remove their "biases (personal and political)". They were reminded that the principal of the Trust could not be touched in any case.

On February 7, 2011, Paul Rich motioned the idea of getting a loan for the money and using the Trust as collateral. It was agreed that this course would be explored. It was also agreed the Bank of Montreal, the representative of the Trust, would look into the matter. On February 14, 2011 Paul Rich put forward a motion to lend the $25 million from the Trust. During discussions the concern of money being used for payouts to community members rather than housing was brought up. The motion was defeated 4-2 in a recorded vote.

During the May 10, 2011 meeting it was discussed and agreed to that public meetings would be held in each community in the middle of June - just weeks before the referendum on the New Dawn Agreement. On May 26, 2011 it was agreed the meetings would be held in the first week of June with expenses for planes, halls, and lunches to be funded. Then, during a Trust meeting on June 3, 2011, just days before the meeting were to take place, they were cancelled.

This is were it gets very interesting. On July 6, 2011, less than a week after the New Dawn vote, the trustees held a teleconference. The issue again was money, but this time it was different. The following motion, the only apparent topic on the agenda, was made:

" Paul Rich made the following motion: The Trust hereby agrees to apply for a loan for approximately $12,500,000 from the Bank of Montreal to provide a per capita payout of $5,000 to each member of the Innu Nation. It was seconded by Mary Jane Edmonds. BMO Trust Company, the corporate trustee, abstained from voting because of the conflict of interest with the application for a loan from the Bank of Montreal.  All other trustees voted in favour and the motion was carried."

So, less than a week after the Innu voted 88% in favour of the New Dawn Agreement, a $5,000 payment was authorized to every man, woman, and child - motioned by non other than Peter Penashue's brother-in-law. There are a few points to digest on this. Firstly, there was discussion during the meeting to have $5,000 payments for children placed in trust - that was summarily ignored in the motion. Secondly, and quite shockingly so, no reason was given for the payout in the minutes anywhere. Thirdly, the average annual income of the Innu people, according to last available census data, is approximately $12,000. Now consider the following facts:


population 1,314
0-4      200
5-9      130
10-14  150
15-19  115

total children 695 or 53% of the population


population 931
0-4      145
5-9      125
10-14  90
15-19  100

total children 460 or 49% of the population

Based on this census data, $6,775,000 of the $15,000,000 would go to children - or their parents on their behalf. To put that in perspective for some, the following are family sizes in:


2 people  100
3 people  95
4 people  60
5 people  80


2 people  65
3 people  60
4 people  50
5 people  55

Keeping in mind the average ANNUAL income in both communities is less than $12,000 per year, many families and individuals were about to hit the jackpot. For example, families with 5 people living in a household looked to receive $25,000.

On July 8, 2011, a formal meeting of the trustees was held. It was announced at that meeting that the Bank of Montreal had approved the loan for $12,500,000 for the $5,000 payout to each Innu. The bank, however, said it would take some time to process the loan. Paul Rich then motioned:

"Paul Rich made the following motion: To advance money from the Teshipitakan Fund to provide money for the per capita payout, and the money advanced from the Fund will be replaced once the loan money is available. The motion was seconded by Gregory Rich. BMO Trust Company, the corporate trustee, abstained from voting because of the conflict of interest with the application for a loan from the Bank of Montreal.  All other trustees present voted in favour and the motion was carried. The trustees were advised that tomorrow is the earliest the funds could be advanced. Janet will discuss with Lorraine Rich and Karen Penunsi about how much money to hold back. Only the amount that we are paying out will be sent to the band office."

In a somewhat incredible twist of events, a sum of $25,000,000 for housing was changed to a sum of $12,500,000 for individual $5,000 payments, days after the New Dawn was successfully approved by referendum, and motioned by Paul Rich - Peter Penashue's brother-in-law. The Peter behind the Muskrat Falls dam as it were. Interestingly, if you do the math, $5000 multiplied by 2245 people comes out to $11,225,000 leaving $775,000 left over. It appears that the early concerns of some trustees that this housing money would be used for personal payouts was warranted after all. It was noted in the minutes that once a major loan was drawn using the children's trust as collateral no other loan could be made in a similar fashion. So, after the New Dawn payout was made the housing crisis was to remain a housing crisis. The sudden reward for voting in favour of the New Dawn, or so it would appear, and the sudden rush to get the money into the hands of the Innu, robbed the future trustees of any ability to leverage that fund for any other purpose. As an aside, the trustees are currently trying to amend the terms of the trust so they can gain access directly to its funds.

The questions that now surround the New Dawn Agreement, which was necessary for the Muskrat Falls project to proceed, are many. Most seem to centre on what happened during the referendum to approve the New Dawn Agreement. It is illegal to offer a reward or bribe to people for voting in favour of a particular thing. It appears quite obvious this $5,000 per person payment was a big reward for some of the poorest people in Canada. There has been many stories of voting money and alcohol bribes to get the Innu to vote in favour of the New Dawn Agreement. In the end though, without sworn affidavits from the Innu themselves, these remain just stories. However, the $5000 per person payments just days after the vote, and sudden in its conception, leads to the inevitable conclusion that these funds were either a reward or a promise of reward fulfilled. That is my take on it. I have also been advised the RCMP were provided with all the documentation surrounding this issue a year ago, but have done nothing in the way of an investigation or forensic audit. If bribery or reward was used on some of the poorest people in the country to push forward the Muskrat Falls dam project, well, that is just unjustifiable in a country that we think we understand. Surely our provincial government knew these payments had taken place. It goes against our laws, our core beliefs, and everything we believe in as a people.

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